CEIBS shifts fo­cus to ex­ec­u­tive ed­u­ca­tion

China Daily (Hong Kong) - - BUSINESS - By XU XIAOMIN in Shang­hai xux­i­aomin@chi­nadaily.com.cn

The lack of in­ter­na­tional tal­ent is one of the big­gest chal­lenges for Chi­nese com­pa­nies ex­pand­ing into over­seas mar­kets, ac­cord­ing to a sur­vey on China busi­nesses con­ducted by the China Eu­rope In­ter­na­tional Busi­ness School or CEIBS.

“A lot of their mis­takes can be traced back to a lack of tal­ent, a lack of em­ploy­ees who un­der­stand how to do busi­ness in the new mar­kets they are try­ing to break into,” said Pro­fes­sor Li Mingjun, pres­i­dent of CEIBS. “The world has changed and Chi­nese busi­ness ex­ec­u­tives have to change along with it.”

He noted that in the 1980s, Chi­nese com­pa­nies do­ing for­eign trade only needed to fo­cus on low-cost pro­duc­tion as pro­fes­sional for­eign trade agen­cies took care of ev­ery­thing else. In con­trast, com­pa­nies mak­ing over­seas in­vest­ments to­day need to han­dle ev­ery­thing by them­selves, from set­ting up joint ven­tures to mak­ing ac­qui­si­tions or green­field in­vest­ments. As a re­sult, tal­ented pro­fes­sion­als who are fa­mil­iar with such mat­ters are ur­gently needed.

“Lan­guage is just one of the bar­ri­ers when it comes to mak­ing in­vest­ment de­ci­sions in a for­eign mar­ket. There is also a need to un­der­stand the busi­ness en­vi­ron­ment, law and cul- ture in a for­eign coun­try. I think this is very dif­fi­cult for most Chi­nese com­pa­nies be­cause they lack the right tal­ents,” he said.

One of the so­lu­tions to this man­power prob­lem lies in CEIBS. Co-founded by the Chi­nese gov­ern­ment and the Eu­ro­pean Union in 1994, the school be­gan by mostly groom­ing tal­ent for MNCs work­ing within China. To­day, as the school it­self has changed to a more in­ter­na­tional fo­cus with cam­puses across three con­ti­nents, CEIBS has turned its at­ten­tion to ed­u­cat­ing busi­ness ex­ec­u­tives who can lead in and out­side of China. This in­cludes ex­ec­u­tives from Chi­nese com­pa­nies that al­ready have or plan to have op­er­a­tions be­yond China’s bor­ders. The 2013 launch of the CEIBS Cen­ter for the Glob­al­iza­tion of Chi­nese Com­pa­nies is part of that ini­tia­tive.

From Septem­ber, the school will of­fer an ex­ec­u­tive ed­u­ca­tion course called “Core Tal­ent for Chi­nese En­ter­prises”. It helps Chi­nese en­trepreneurs gain deeper in­sight into the in­ter­na­tional econ­omy, for­eign cul­tures, ac­count­ing knowl­edge for over­seas in­vest­ment and lead­er­ship. It also aims to help Chi­nese com­pa­nies get a clear pic­ture of glob­al­iza­tion and how to con­trol risk dur­ing merg­ers and ac­qui­si­tions.

“We have seen many Chi­nese com­pa­nies suc­ceed in their over­seas ac­qui­si­tions; we have also seen oth­ers fail. We found that many com­pa­nies ac­tu­ally paid too high a price as they did not have enough in­for­ma­tion about the busi­ness, risk con­trol and lo­cal busi­ness en­vi­ron­ment,” said Li.

“In ad­di­tion, po­lit­i­cal sta­bil­ity is another area that Chi­nese en­trepreneurs aren’t very fa­mil­iar with. Be­cause of this, CEIBS is look­ing to in­tro­duce classes that touch on in­ter­na­tional re­la­tions and na­tional in­ter­ests.”

In or­der to be closer to Eu­rope’s busi­ness mar­kets, CEIBS set up its Zurich cam­pus in 2015. Li said that the school is plan­ning to or­ga­nize fo­rums in Eu­rope ev­ery year. This year, events will be held in five cities in­clud­ing Lon­don and Paris this month, Mu­nich and War­saw in Septem­ber and Zurich in Oc­to­ber.

“It is im­pos­si­ble to solve all prob­lems through a course at busi­ness school, but en­trepreneurs can at least have a com­plete pic­ture of the sit­u­a­tion and pro­vide some pos­si­ble so­lu­tions through their stud­ies,” Li said.

The sur­vey by CEIBS also found that 36 per­cent of com­pa­nies said they con­sid­ered over­seas ex­pan­sion as their key ob­jec­tive, while 42 per­cent said they saw it as “very im­por­tant” to their fu­ture.

China’s out­bound di­rect in­vest­ment or ODI has been in­creas­ing since 2000 and it ac­cel­er­ated more quickly fol­low­ing the fi­nan­cial cri­sis in 2008. Be­tween 2009 and 2014, the num­ber of ODI ac­tiv­i­ties per year rose from 38 to 113, ac­cord­ing to re­search of Zero2IPO Group. In 2016, China’s non-fi­nan­cial ODI soared 44.1 per­cent year-on-year to $170 bil­lion, ac­cord­ing to data from the Min­istry of Com­merce.

In the past, only big Sta­te­owned com­pa­nies played a key role in over­seas in­vest­ment. In 2013, about 60 per­cent of Chi­nese man­u­fac­tur­ing com­pa­nies with over­seas in­vest­ments were pri­vate en­ti­ties. While Asian coun­tries were once the ma­jor in­vest­ment des­ti­na­tions of Chi­nese pri­vate com­pa­nies, the fo­cus has now shifted to the United States and Eu­rope.

Li Mingjun, pres­i­dent of CEIBS

PRO­VIDED TO CHINA DAILY

Li Mingjun, pres­i­dent of CEIBS, be­lieves the school will cul­ti­vate more in­ter­na­tional tal­ent to help Chi­nese com­pa­nies ex­pand over­seas.

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